39) Tanning Company analyzes its recievables to estimate bad debt expense. The accounts recievable balance is $390,000 and credit sales are $1,300,000. An aging of accounts recievable shows that approximately 5% of the outstanding recievables will be uncollectible. What adjusting entry will Tanning Company make if the Allowance for Doubtful accounts has a credit balance of $2,500 before adjustment?

A) Bad Debt Expense 17,000

Allowance for Doubtful Accounts 17,000

B) Bad Expense 19,500

Allowance for Doubtful Accounts 19,500

C) Bad Debt Expense 22,000

Allowance for Doubtful Accounts 22,000

D) Bad Debt Expense 65,000

Allowance for Doubtful Accounts 65,000